Sales tax from oil and gas boom boosts economies

Huebner Chevrolet in Carrollton has seen a steady increase in vehicle sales in recent months — especially trucks — as companies have moved into the area because of the oil and gas boom. Counties throughout the Utica and Marcellus shale reservoirs in Ohio have experienced similar increases.

Huebner Chevrolet in Carrollton has seen a steady increase in vehicle sales in recent months — especially trucks — as companies have moved into the area because of the oil and gas boom.

“Last month was a record-setting month for us,” said manager Josh Cole, noting that the dealership sold more than 30 Subarus in March.

That activity has helped to push Carroll County’s sales-tax receipts to higher and higher levels.

In January, the county collected $348,000, a $100,000 increase over January 2012, when the county collected $242,000, according to county Auditor Leroy VanHorne.

All of that money goes into Carroll County’s general fund.

The news is even better in Harrison County.

Its sales-tax receipts in January more than doubled during the same time period in 2012, going from $188,000 in 2012 to $437,000 in 2013.

“It’s a heck of an increase,” county Auditor Patrick Moore said. “That’s what shocked me.”

Counties throughout the Utica and Marcellus shale reservoirs in Ohio have experienced similar increases. A study released in March by Cleveland State University found that what it described as “strong shale counties” saw a 21.1 percent increase in total sales activity in 2012 ($14.9 billion) as compared to 2011 ($12.3 billion).

“Strong shale counties not only reversed negative average sales trends from the previous three years, but also outperformed the moderate, weak and non-shale counties on this metric between 2011 and 2012,” the report said.

Tuscarawas County saw a big increase in tax receipts from 2011 to 2012, but its collections didn’t jump as much from January 2012 to January 2013 as they did in Harrison and Carroll counties.

Receipts increased 10.77 percent from 2011 ($9.5 million) to 2012 ($10.6 million). But for the first three months of 2013, receipts were only $64,000 more than the same three months in 2012, Lindberg said.

Before oil and gas exploration began in Carroll County, it normally collected about $175,000 per month in sales taxes, VanHorne said.

January 2012 was the first time Carroll County ever collected more than $200,000 from its sales tax, when receipts were $242,000. In July 2012, the number went even higher — $270,000.

He attributed the increase to residents spending more money on such things as motor vehicles and furniture as they received signing bonuses for leasing their land to energy companies.

“Now the pipelines are coming,” VanHorne said, noting that most landowners in Carroll County are being paid $15 a foot for allowing a pipeline to be built on their property.

He anticipates that pipeline construction will continue for years to come. “I talked to one of the crew foremen, who is from West Virginia, and he said they could be here for 25 years. They need that many pipelines.”

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An influx of workers also has helped Carroll County’s bottom line. At one time, as many as 40 land title researchers were working for energy companies in the courthouse at the same time.

“They’re going to eat here, and they have to have a place to stay,” VanHorne said.

Overall, the county has seen a $618,000 increase in sales-tax collections from 2011 to 2012, which he said helps the general fund tremendously.

“What we have to be careful of is, don’t let it become part of a spending trend,” he said. “If it’s gone, we will be crying.”

Thanks to the increased revenue, Harrison County ended 2012 with a $959,000 general fund balance, Moore said. “Just a few short years ago, we were ending the year $100,000 in the red.

“It’s been great for the county. Hopefully, it will continue, and the commissioners will put the money to good use.”